International law is traditionally considered to be made by the sovereign states
and for the sovereign states. Its subject matter includes diplomatic relations,
military issues and state territory. The exclusive focus of International law on
relations among states has proved to be both a source of strength and of
weakness. The control which is exercised in the making and implementation of
International law by the different states has greatly contributed to the
increase in the effectiveness of the law. it is very unlikely that the States will develop any legal
norm unless there is a harmony with their national interests and unless they
plan to abide by them.
The consent of states is the cornerstone of international law. This process of
communication
from which the consent emerges is quite complex, but leads to typical outcomes. Treaty is one
such outcome, in which consent is given explicitly to any rule of international
law. Customary international law is another outcome, where such consent is more
implicit in nature. Treaties and customary law are two such norms which continue
to be the most important sources of international law.
New areas of international law emerged in the course of the 20th Century, which
was
completely different from the traditional pattern of a legal system which concerned solely with
relations among sovereign states. These human rights were the new area which
emerged as an important area of concern for the world community.
The provisions
relating to human rights deal with the treatment of individuals and groups, laws
relating to international criminals and international economic law that purports
to regulate the activities of private participants in the
international market and also with the approach of the states to deal with them. Contrary to the
more traditional areas of international law, these newly emerged fields are not
primarily concerned with balancing state interests. Their area of concern is the
rights and duties of individuals, groups and companies.
State boundaries have been transcended by many of the interests involved. Some
of them aim
at the entire global community. But most of the legal techniques for handling these international
issues have remained largely unchanged. The states still control a lot of legal
tools, and these legal tools are usually conditional upon their consent and are
often aim at furtherance of their specific interests. To begin with the topic,
it is desirable to survey briefly the traditional typology of the sources of
international law. Thereafter, the application of international law in
particular in international investment law is demonstrated.
- To study interaction between the sources of International law; and
- To study application of International law
Meaning and definition of International Law
Meaning
International law is the body of agreements and treaties between the nations which govern and
determine the interaction of one nation with other nation, one nation and the
citizens of other nation and also the business interactions between different
nations. In today’s world of
globalization, no state can exist independently and in seclusion. Every state is in relation to the
other states of the world.
International law can be divided into two different
categories which are as follows:
- Private international law,
- Public international law.
Private International law is applicable to the cases involving the disputes and
controversies between the private bodies like humans or corporations which have
a relationship with one or more nations. For example, the legal dispute which
arose due to the toxic gas leak from the industrial plant which was owned by
Union Carbide, the U.S. Corporation in Bhopal, India is considered as a dispute
which is governed by the principles of private international law.
Public
International law mainly governs the relationship between nations. The legal
areas of which are governed by this law are standards of international behavior,
laws relating to the sea, economic laws, environmental laws, laws relating to
human rights, and diplomatic laws.
The principles of public International Law
can be written or unwritten i.e. codified or uncodified. The principles are
codified usually under the treaties. The principles which are uncodified are
known as customary laws and there is no need for the nations which consider such
laws to be binding upon themselves to do any overt act to ratify it.
Definition of International Law
There has been no consensus between the jurists regarding the definition of
international law because of the nature of the international law which is very
difficult to confine under the
boundaries of words. However, several jurists have defined the term.
Below are the definitions
by some of the prominent jurists and experts:
- Prof. L. Oppenheim:
Law of Nations or International Law is the name for
the body of
customary and conventional rules which are considered legally binding by the civilized
states in their intercourse with each other.
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- J.L. Brierly:
The Law of Nations or International Law may be defined as the
body of rules and principles of action, which are binding upon civilized states
in their relations with one another.
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- Torstein Gihl:
The term International Law means the body of rules of law
which apply within the International Community or society of Sates.
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- In the Queen v. Keyn, Lord Coleridge, C.J., defined International law in the following
words:
The law of nations is that collection of usages which civilized States
have agreed to observe in their dealings with one another.
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- R.N. Gilchrist:
International Law is the body of rules which civilized
states observe in their dealings with each other. These rules being enforced
by each particular state according to its own moral standard or convenience.
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Sources of International Law
In the absence of any world government, there is no world Congress or parliament
to legislate international law the manner in which ordinary laws of any country
is drafted. This creates a difficulty in determining what exactly International
law is. It is desirable to survey the traditional typology of the sources of
international law at the onset.
The International Court of Justice while deciding any dispute in the international arena is guided
by Article 38 of the Statute of International law which directs the manner in
which the hierarchy of sources of International law has to be applied in an
orderly way.
The hierarchy of the sources of International law as directed by
the statute is as follows:
- General or particular International conventions, which establishes the
rules expressly recognized by the contesting states;
- International custom, which are evidenced by a general practice accepted
as law;
- The general principles of law which are recognized by civilized nations;
- The judicial decisions and the teachings of the most highly qualified
publicists of the various nations subject to the provisions of Article 59
are to be considered as subsidiary means for the determination of rules of
law.
Treaties
Treaties are basically the agreements which are entered into by the sovereign
states and they are the most important sources of the International law. They
are also known as pact,
agreement, covenant, charter, protocol, memorandum of understanding and exchange of letters.
Treaties deal with a large spectrum of topics and they either be unilateral or
bilateral. The multilateral law-making treaties codify certain fields like Law
of Diplomatic Relations or the Law of the Sea. The people who are interested in
understanding the development of International law mostly focuses on
multilateral treaties.
Some of the multilateral treaties have been quite successful and have been
ratified by most of the states and have been useful in bringing stability to the
areas of international law which are
regulated by them. The Vienna Convention on Diplomatic Relations, which commands almost
universal participation and acceptance is probably the best example. However,
such partial success can’t veil the fact that the creation of multilateral
treaties suffers from many shortcomings.
The process is both cumbersome and
protracted. For example, the Law of the Sea
Convention, the making of which was initiated in 1973 with the United Nations Conference on
The Law of the Sea took until 1994, to complete its entry into force for 60 states and even then
it was not ratified by most of the countries including United States and
United Kingdom.
There are several stages involved in the making of a multilateral law-making treaty.
These
are as follows:
- The first is deliberation by an expert body such as the International
Law Commission.
- The acceptance of a draft treaty by a political body, such as the
General Assembly of the United Nations.
- Then, the text of the draft treaty is finalized usually at a State
Conference.
The treaty is finally ratified by the individual states which
results into the enforcement of the treaty. Even after coming into force a
treaty, only those states are bound by it that have given explicit consent to be
bound. The withholding of the consent by even a single but a powerful state like
America can severely undermine the enforceability of the treaty. Recent examples
of such a situation are the Law of the Sea Convention, the Comprehensive Nuclear
Test Ban Treaty or the Rome Statute for an International Criminal Court.
The states even after ratifying a treaty could reduce its impact by attaching
far-reaching reservations. A reservation is a unilateral statement by a state
purporting to exclude or modify the legal effect of certain provisions of a
treaty in their application to that particular state. The objections to the
reservation could be raised by the other states.
Whether the reservation
conforms to the treaty's objective and purpose is the most essential standard
for the admissibility of a reservation. One of the best examples of the dilemma
which arose out of the reservations is the Convention on the Elimination of All
Forms of Discrimination against
Women of 1979.
This Convention has been ratified by several Islamic states, however, subject
to far-reaching reservations. A large number of countries have raised objections
to these reservations as being contrary to the objective and purpose of the
Convention.
Another drawback of the treaties is the interpretation and application of
treaties, which is frequently complicated because of the different language
versions of them and the way they are framed by lawyers who operate under
different legal traditions. The multilateral law- making treaty is thus
considered far from being considered as an effective instrument of international
legislation. But bilateral treaties generally serve as an instrument of
lawmaking.
In fact, a series of bilateral treaties regulate certain areas of
international law. To name a few, extradition treaties, air transport
agreements, and bilateral investment treaties. However, in the
course of time it has become apparent that this method is neither efficient nor elegant. To create
a network of bilateral treaties on a single topic, among all 188 members of the United Nations,
17,000 such treaties are required, with each of these treaties being negotiated
individually! Although often similar, these treaties are likely to display
variation and consequently, do not create uniformity and equality of treatment.
Customary Law
Customary laws are much more common in international law than in most of the
domestic legal systems. These in a way
reflect the lacuna of the International law to develop any efficient law-making
system. The pattern of the international relationship between the states is the
primary source of evolution of the customary international law. These behavioral
patterns are known as
practices. If there is also a belief attached to the
practice that it is based on any legal obligation or
opinio juris, then the
practice becomes a customary international law. There are several theoretical
problems attached with the customary international law.
Some of the important
questions which mostly remain unanswered are as follows:
- How widespread a practice should be to consider it as a customary
international law?
- How much time a practice takes to establish itself as a customary law?
- How does one rule of international law replace by another such rule?
There are also practical disadvantages with the customary international law. One
of the major problems lies in the fact that Customary international law can be
difficult to establish conclusively as to studying the practices of so many
states finding out the relevant statements expressing a legal conviction, where
such is available requires a lot of research.
Sometimes customary international
law also turns out to be somewhat vague and open to conflicting interpretations.
In a case where the perceived interests of certain states or groups of states
change, their attitude towards customary international law will also be altered, and a particular
rule may then be challenged.
General Principles of Law
General principles of law as a source of international law are theoretically
equivalent to treaty or customary law. But in actual practice, general
principles are used mostly used to cement those gaps which are left by treaties
and customary law. Comparison of various national legal
systems around the world establishes General Principles of law. The principles which are found
common in all or majority of the legal systems in the world are considered to be
applicable even in the International arena. The examples of such principles
would be the binding nature of agreements, protection of acquired rights, and
prohibition of unjust enrichment or principles of procedural fairness before a
court of law.
General principles of law are applied quite often, especially by international
arbitral tribunals and are considered to be an important source of International
law. The drawback of General principles of law is that the positive proof of
their existence and application is more or less
complicated and so they turn out to be rather unwieldy. In practice it is not possible to compare
all the legal systems of the world. A practical solution is often tendered by
studying some leading representative systems of law, derived from different
legal cultures such as civil law,
common law and Islamic law, quite often with the help of secondary publications in languages
which are accessible.
Decisions of Courts and Tribunals
In strict sense the decisions of the courts and tribunal and scholarly writings
are not proper
sources of International law. It means that the courts of law and legal scholars are not supposed
to create the law and their work is to apply the existing laws, and to clarify legal provisions by
their decisions and writings.
The practical aspect of the value of the decisions of courts and tribunal is not akin to the theory
as the distinction tends to get rather blurred. The importance of the decisions
of courts and tribunal is easily discernible to anyone who studies international
law in greater detail, as the courts and arbitral tribunals have actually
advanced the law, and the theoretical framework provided by a scholar tends to
influence decision-makers in practice.
This is quite obvious because there is a
good deal of interaction in professional circles, among those who are
involved in treaty-making, state practice, adjudication and scholarly publications. For example,
sometimes professors become judges, give advice to the parties involved in any
legal proceedings or are consulted by government officials.
In other words, there is a community of international lawyers, similar to other
scientific communities like those of astronomers, anthropologists
or cardiologists.
Decisions of International Organizations
The statute of the court of justice declares only four official sources of
international law but a question is posed by most of the scholars that if the
list of the sources of International law is
exhaustive and what about the decisions of the International Organizations which have proved
to be a major source of International law in the course of time as they have not been mentioned
as a source of law.
The reason behind the non-inclusion of the decisions of International
Organizations could be easily perceived. The official list containing the
sources of International law was
incorporated in the Statute of the International Court of Justice about 80 years ago, long before
international organizations became a prominent feature of international life.
Therefore, the decisions of these international organizations are relatively a
newer phenomenon. However, their importance in the contemporary scenario cannot
be denied.
The acceptance of decisions of international organizations also lead to fresh
problems as the decisions of international organizations are extremely diverse
in nature they defy any generalized description or analysis. Yet, the fact that
some emanate from regional organizations like the European Community or the Gulf
Cooperation Council and others from global organizations, like the United
Nations, is a relatively minor problem. The major problems arise on the question
of the legal nature of these decisions in any particular case.
Some decisions like the regulations of the European Community are generally
binding rules, and are comparable to domestic legislation. Many others, like the
Resolutions of the General Assembly of the United Nations, are mere
recommendations. But it does not follow that they do not have any legal
relevance. In fact, legal arguments are usually backed by these recommendations.
However, not all of these decisions are equally authoritative and a detailed
analysis of such factors as the number of positive votes, which countries
voted in favor or any confirmation
through repetition, is required to determine the legal significance of these decisions. The matter
is further complicated by the adoption of certain decisions as binding at some
times by the bodies like United Nations Security Council, such as resolutions
imposing sanctions on
members.
The Security Council simply passes a recommendation calling upon states to follow
a particular course of action, like suggesting a form of dispute settlement in
the other times. The determination of the legal nature of a particular Security
Council Resolution requires that its text should be studied with a view to
interpret the intention of the Council while framing those decisions. In most
cases, however, this is not a practical problem.
Interaction of Sources
After the analysis of different sources of international law, it is desirable to
clarify the relationship of these sources with each other. It would be an
incorrect assumption that the different sources of international sources exist
in isolation: that some aspects of international law are regulated by treaties,
others by customary international law and the remaining others by the decisions
of international organizations. In practice, different sources interact closely
and impact each other.
In reality International law is not just a static system of rules but is
basically an evolution of decision-making process. The identified rules of law
are the abstractions which are derived from this process, but they are not its
essence. Even a treaty, which apparently is a clear set of written rules, is
part of this process.
Treaty is a result of a long evolution that involves
customary international law, prior treaties and often deliberations and
decisions made by international organizations. After the conclusion of any
treaty the next step is its implementation and interpretation by international
and domestic courts, it finally becomes a part of state practice, which
sometimes leads to the evolution of new customary international law and may
ultimately be amended or abrogated by any another concluded treaty.
The complex interaction of the sources of International law finally breeds a
very practical consequence. While examining any legal issue it is not enough to
find the ‘right’ rule only by identification of the treaty that is applicable or
the appropriate rule of customary international law. Rather, it is pertinent to
take a synoptic look at the various sources in order to analyze their relative
relevance and authority.
Application of International law
The observations which are stated above can be illustrated by giving a wide
overview of international investment law. Basically, investment law was
considered to be mostly derived from customary international law. Today some of
the traditional investment law still exists.
It provides the foreign investors
with certain procedural guarantees, like fair treatment and protection of
investors by the home states, compared to the host states. The two important
features were and still are the protection of property from expropriation, and
adherence with terms of contracts concluded between investors and host states.
By the 20th century several events which took place disturbed the seemingly
stable picture of the international investment law. The very first amongst these
events was the upsurge of socialist ideologies, chiefly in the Soviet Union with
its abandonment of private business and property rights. The development of new
doctrines in Latin America with to shed economic domination by the European
powers and later by the United States was second such event.
Such Latin American
doctrines gave rise to the Calvo Doctrine, named after the 19th Century
Argentinian diplomat and Jurist Carlos Calvo. This doctrine aims at keeping the
foreign investors at par with the
national investors and denial of any special treatment for better or for worse.
The third was decolonization and it is regarded as the most consequential one.
Many newly
independent countries contended that the guarantees and special treatment was reserved by the
foreign investors in their land during the unequal conditions, and that the
continuation of such
privileges constituted perpetual exploitation, and that investors had made and were still making
excessive profits, at the cost of the host countries and their populations. The
exploitation of raw materials were the major investments that often-stirred
controversies, in countries which were heavily dependent on these raw materials
for their export earnings.
The consequential disputes were discussed in various scholarly publications, in
international
organizations and before arbitral tribunals. In addition to the references to the investment laws
these disputes also involved the invocation of general principles of law by both sides while the
investors' side relied on
acquired rights and the
sanctity of
contracts the host countries relied on
unjust enrichment and on the
unequal nature of the
agreements. Additionally, a new doctrine was developed under the label of
permanent sovereignty over natural resources.
This doctrine has been included in several resolutions passed by the United
Nations General Assembly and it most importantly proclaimed that states shall
have a permanent and inalienable right to control the natural resources in their
territory, irrespective of any contractual or property rights that foreign
investors may have acquired. The permanent
sovereignty over natural resources was preferred over the principle of sanctity of contracts and
property rights.
This conflict has
culminated in a series of resolutions which were adopted by the UN General
Assembly in the 1970s. The Charter of Economic Rights and Duties of States,
adopted in
December 1974 was the most important of these resolutions. An overwhelming majority which
was controlled by developing and socialist countries had approved it. Most of
the negative votes or abstentions came from western industrialized states. Not
everything contained in that resolution was controversial. Some of the
principles like sovereign equality, peaceful settlement of disputes and
promotion of international social justice were acceptable to all. But
the provisions regarding expropriation was one point on which differences were irreconcilable.
In principles, the right of the states to expropriate was not contested. However, there was some
relief which was sought to be provided by the inclusion of a new clause in the Resolution which
provided that where a dispute arises over compensation for expropriation, the
right to decide such case shall lie with the courts of the expropriating state
and on the basis of the law of the expropriating state.
In was an attempt to
de-internationalize the issue by making it an internal matter of the state that
took the action. However, this was not acceptable to the capital-exporting
states and to the investors themselves as they insisted that any expropriation
would have to be compensated, and that this compensation would have to be
adequate, meaning that it would have to represent the full value of the
expropriated property, that it would have to be prompt without undue delay, and
should be effective, that is, in a convertible currency.
Whether a nonbinding resolution of the United Nations General Assembly could
abrogate customary international law was a major point of discussion. In one of
the famous arbitral awards in a case against Libya it was specifically denied.
One of the conceptual problems of customary international law was the continuing
overwhelming legal conviction of the international community in the face of a
contrary resolution of the General Assembly adopted with a large majority.
How
to terminate an existing rule of customary international law? Is it
possible only by the introduction of a new positive rule of customary international law? Or can
it simply terminate, if one of the two elements for its creation, such as
practice or legal conviction, no longer exists? Were some of the questions which
were posed by most of the scholars of that time.
The practical consequences of confrontational atmosphere and developments that
prevailed
were not favorable to economic development. A number of uncompensated expropriations
which were pronounced on investor protection in international organizations
received adverse publicity in the West. Investor confidence waned. In the 1970s
and 1980s foreign direct investment dropped steadily. The debt crisis of the
1980s was one of its consequences. Economic development in many countries came
to a halt or even showed signs of regression.
In the 1990s this situation underwent a transformation. The major reason for
this transformation was the acknowledgment in most developing countries that the
continuing flow of private investment is the biggest single factor in economic
development. The private investment demands a secure legal environment, and
these legal safeguards had been undermined seriously in the 1970s.
Interestingly, the traditional bilateral treaty turned out to be the most important legal instrument
to restore investor confidence. The bilateral investment treaty (BIT) was
pioneered by
Switzerland and Germany and in no time, it became the favored way for many countries to
guarantee legal protection to investors. The access for investors and guarantee
of fair and equitable treatment is regulated by BITs. In the case of expropriations, typically by providing for
full, prompt, and effective compensation these treaties grant protection. The
most important part of these treaties is that in case of disputes between
investors and host states, they offer procedural guarantees, typically through
provisions for international arbitration.
By no means are BITs concluded only between industrialized and developing
countries. They have turned into a ubiquitous aspect of international economic
relations. Most often they are concluded between developing countries. The
succeeding states of the Soviet Union have concluded many BITs. China has BITs
with about 100 states. The different estimates reveal that now there are over
1,500 BITs worldwide. Domestic legislation is another unexpected
source of international investment law. In today’s world, the capital-importing states are eager
to project themselves as secure and reliable domains for foreign
direct investment.
The creation of a multilateral treaty is one obvious way of improving
international investment law. However, the attempts to create a comprehensive
Multilateral Agreement on investment (MAI) designed in order to supplement or
replace the multitude of bilateral treaties have not succeeded and are not
likely to succeed in the near future.
However, the Convention on the Settlement of Investment Disputes between States
and Nationals of other States is one of the multilateral treaties dealing with
dispute settlement that deserves mentioning. It is. This Convention is
responsible for the International Centre for Settlement of Investment Disputes (ICSID).
An independent system of conciliation and arbitration is offered by ICSID Convention and it is, in principle, available in most investment
disputes.
Most of the capital-exporting and capital importing countries have
ratified this
multilateral treaty. It is required that the host state and the investor agree to submit any disputes
to this system by concluding a contract between the two parties. A clause in
domestic legislation or in a bilateral investment treaty offering this form of
dispute settlement to investors who may take up this offer at any time is often
frequent.
This system offers advantages to both sides involved in an
international dispute case. The investment climate is
improved by the host state by boosting investor confidence and thereby is likely to attract more
investment. Additionally, the host state gains a guarantee that the home state
of the investor will not exert any diplomatic pressure on the host state.
In
turn, the investor is no longer required to depend on the domestic courts of the
host state that might be perceived as biased by him. Instead, he acquires
access to international arbitral tribunal. The tribunal applies not only the
domestic laws of the host state but also international law. The result is a
binding and enforceable arbitral award that is to be abided by all countries
that are parties to the Convention.
It is estimated that more than half of the world's private investments are currently protected by
this system. Many cases have been decided under this system and there are still
a larger lot of the pending cases. More importantly, the mere knowledge of
existence of an effective system of dispute settlement has a deterrent effect
and so it is likely to induce legal conformity in the first place which will
definitely contribute towards stability.
The review of the decisions of arbitral tribunals under this system emerges an
already familiar picture. All the sources of international law are applied by
these tribunals jointly and not separately. Multilateral and bilateral treaties,
typically BITs are also relied on by these tribunals. Customary international
law and general principles of law are applied by them. The tribunals also refer back to decisions
of other arbitral tribunals and international courts. Thus, the interaction and interrelation of the
various sources of international law can clearly be discerned even in the
microcosm of an arbitral award in an investment dispute.
Conclusion
There are various sources of international law such as treaties, customary international law and
general principles of law. Practically, these sources are closely interrelated
and often interact by supplementing and replacing one another. Mostly a rule
created in one type of source consequently emerges in other form of source.
Thus, these sources of international law ought not to be viewed in isolation.
Most states around the world are bound by numerous international instruments
guaranteeing a
broad range of human rights. A question that is often raised is what happens when a particular
state is bound by two international instruments which set out diverging levels
of protection of a particular human right. The general rule in this regard is
that in such a case the state implements the most far-reaching obligation or
highest standard. To this effect most of the human rights conventions contain
special provisions.
For example, Article 5(2) ICCPR and Article 5(2) ICESCR provides that ‘There
shall be no restriction upon or derogation from any of the fundamental human
rights recognized or existing in any state party to the present Covenant
pursuant to law, conventions, regulations or custom on the pretext that the
present Covenant does not recognize such rights or that it recognizes them to a
lesser extent.’
The number of ratifications and accessions to conventions demands special attention within the
realm of standard setting. The human rights conventions which have been widely ratified have
a greater value and impact, and they reinforce the universal character of human
rights law, as well as the equality of all human beings under the law. Widely
ratified conventions (with possibly lower number of reservations) contribute
highly in ensuring equal application of human rights standards.
It is contended by most of the scholars that much of the standard-setting work has already been
completed. In addition, it is pointed out that in recent decades there has been
an excessive proliferation of standards, and a means for better implementation
of the existing norms are required. Further elaboration of basic human rights is
the need of the hour as they have only been roughly defined. Better legal
protection is required for human rights defenders, lesbian, gay, bisexual, and
transgender people and persons belonging to indigenous peoples, or in relation
to particular issues such as transitional justice or scientific advances
in biomedicine.
In the current international system, the law-making process is far from ideal,
as it is poorly coordinated and rather haphazard. However, even after this
structural weakness, most of the time the system works surprisingly well but
this must not induce complacency. The present and prospective global challenges
call for fresh thinking in the sphere of international law. It requires a high
level of creativity to come up with innovative ideas and techniques and even
greater courage to implement them effectively.Â
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