International Arbitration: Resolving Disputes Between States
International Arbitration
Hague Convention of 1907
According to Article 37 of the Hague Convention of 1907, international arbitration settles disputes between states through judges they elect, based on respect for law. The arbitration agreement includes a commitment to submit in good faith to the arbitral ruling. Generally, states determine the substantive and procedural rules applied in arbitration through their consent.
The state designates the body or persons acting as referees, the extent of their powers, the Arbitral Tribunal’s workings, the procedure, the language used, the applicable law, the nature of the sentence, and its appealability.
Appeal of Interpretation
As per Article 82 of the Hague Convention of 1907, any dispute concerning the award’s interpretation and enforcement is subject to the court that made the award, unless otherwise stipulated.
Appeal Review
Review is appropriate if a party invokes a “new fact” with potentially decisive influence, unknown to the Tribunal and the requesting party, and this ignorance isn’t due to the party’s negligence (Art. 39, Model Rules of International Law Convention).
Some customary international law rules may apply to core arbitration subjects.
Procedure
Commitment
Arbitration is constituted by a special agreement, which can pre-exist the dispute and be agreed upon in a multilateral or bilateral treaty. It can also be agreed upon after the dispute begins, appointing the arbitrator and relevant rules. If the referee is a government, they typically appoint qualified jurists to the Arbitral Tribunal.
Written Phase
Parties present their arguments in fact and law, accompanied by evidence.
Oral Phase
State representatives and lawyers present evidence and make claims.
Judgement (Arbitration Award)
The written and reasoned judgement (award) is required by practice and instruments like the Hague Convention of 1907 and the 1958 Model of Arbitration Procedure.
Obligation to Which the Sentence
Derived from the 1907 Hague rules, commitment obligation usually exists. The 1958 Model Rules of the CDI state that the arbitral award must be justified on any point it decides (Art. 31).
Mandatory Nature of the Sentence
Given its judicial nature, the award has res judicata. It finally decides the dispute and is binding from delivery, according to the Commission’s Model Rules. It should be implemented in good faith immediately, unless the Court sets limits (Art. 32).
Enforceability of the Judgement
A controversial aspect. Lack of enforcement by an international body doesn’t imply lack of compulsion. Rejecting an award and refusing the process leads to international responsibility.
Challenging the Decision
Debatable. The Model of Arbitration Procedure draft admits this possibility for just reasons, like excessive Court power, member corruption, lack of sentence motivation, serious procedural rule infringement, or invalid arbitration stipulation (Art. 35).
In practice, states mostly comply with rulings, even unfavorable ones. Ignoring an award endangers peace and security, as seen in near-conflicts like Chile and Argentina. Practice confirms arbitration’s importance in resolving disputes. However, the current trend favors the International Court of Justice over arbitration.
Permanent Court of Arbitration
This is neither a permanent court nor tribunal, but a list of arbitrators appointed by states party to the Convention. Each state can appoint up to four referees with recognized competence in international law, highest integrity, and willingness to accept arbitrator duties. Based in The Hague, it saw relative effectiveness, settling disputes with tribunals composed of its members. In the late 20th century, the trend shifted towards dispensing with its guidelines when forming arbitrations.
National groups proposing Nobel Peace Prize candidates hold greater importance now. They could also propose International Court of Justice judges, but governments also do so through the Court’s International Bureau, adopting instruments complementary to the 1899 and 1907 Hague Conventions.