Settlement of International Disputes — ICJ, Arbitration

The peaceful settlement of international disputes is the procedural counterpart to the substantive law on the use of force. Article 2(3) of the UN Charter requires all members to settle their international disputes by peaceful means in such a manner that international peace and security and justice are not endangered. Article 33(1) lists the available techniques: negotiation, enquiry, mediation, conciliation, arbitration, judicial settlement, resort to regional agencies or arrangements, or other peaceful means of their choice. The 1970 Declaration on Principles of International Law concerning Friendly Relations confirms that the parties have a free choice of means and that there is no inherent hierarchy among the listed methods. This chapter takes the methods one by one and then turns to the two binding methods of inter-State adjudication — arbitration and judicial settlement before the International Court of Justice — that sit at the apex of the system and provide the structural anchor for the wider international law for judiciary notes on this site.

Two threshold rules govern the entire field. First, States are not obliged to settle their differences. They are obliged to seek a settlement by peaceful means; they are not obliged to reach one. Second, all the techniques listed in Article 33 are operative only on the consent of the particular States. This is the practical contrast with municipal law and the reflection of sovereign equality at the procedural level. The Permanent Court in Mavrommatis Palestine Concessions defined a dispute as ‘a disagreement over a point of law or fact, a conflict of legal views or of interests between two persons’ — a definition the International Court has reaffirmed across its case-law on jurisdiction.

Diplomatic methods — negotiation, good offices, mediation, enquiry, conciliation

Negotiation is the simplest and most-used technique. It involves discussions between the parties themselves, without any third party at that stage, and is normally the precursor to other settlement procedures. The International Court has emphasised that negotiations are distinct from mere protests and require at the least a genuine attempt by one party to engage in discussions with the other with a view to resolving the dispute. Where there is an obligation to negotiate — arising from a particular bilateral or multilateral agreement — this implies an obligation to pursue the negotiations meaningfully, not merely as a formal process. The Court held in the North Sea Continental Shelf cases that the parties must so conduct themselves that the negotiations are meaningful, which will not be the case where either party insists upon its own position without contemplating any amendment of its position. The Lac Lanoux arbitration noted that consultations and negotiations must be genuine, must comply with the rules of good faith, and must not be mere formalities. The connection between bargaining and binding adjudication is taken further in the chapter on treaty formation, validity and termination, where the same good-faith requirement appears in the rules on negotiation of treaty texts.

Good offices and mediation involve a third party — an individual, a State or group of States, or an international organisation — who attempts to influence the disputing sides to reach a settlement. Technically, good offices are involved where the third party simply tries to bring the parties to the table; mediation involves the active participation of the third party in the negotiating process. The dividing line is often blurred. Examples cited in the literature include the role of the United States President in concluding the Russo–Japanese War of 1905, the role of the Soviet Union in mediating between India and Pakistan in 1965 (Tashkent Declaration), and the role of the UN Secretary-General in the Geneva Agreements of 1988 on Afghanistan. The Hague Conventions of 1899 and 1907 confirmed that the offer of good offices or mediation, even during hostilities, is never to be regarded as an unfriendly act, but the procedures are not binding.

Enquiry is the institution of a commission of impartial observers to ascertain the facts in contention. The 1899 Hague Conference first elaborated provisions for it as an alternative to arbitration, and the procedure was successfully used in the Dogger Bank incident of 1904, where Russian naval ships fired on British fishing boats in the belief that they were hostile Japanese craft. The 1907 Hague Conference elaborated the technique further. The United States concluded forty-eight bilateral ‘Bryan treaties’ between 1913 and 1940 each providing for a permanent commission of enquiry. In modern practice the technique has fallen out of favour as a stand-alone mechanism and has merged into other procedures of fact-finding within the United Nations and specialised agencies, especially those that intersect with the rules examined in the chapter on international human rights law and treaty bodies.

Conciliation involves a third-party investigation of the basis of the dispute and the submission of a report embodying suggestions for a settlement. It combines elements of enquiry and mediation. Conciliation reports are only proposals and do not constitute binding decisions, which is the principal point of contrast with arbitration. The General Act on the Pacific Settlement of International Disputes of 1928 (revised 1949) elaborated the rules. A number of modern multilateral treaties — the 1948 American Treaty of Pacific Settlement, the 1957 European Convention for the Peaceful Settlement of Disputes, the 1969 Vienna Convention on the Law of Treaties, the 1982 Convention on the Law of the Sea among them — provide for conciliation as a means of resolving disputes. The Iceland–Norway dispute over the continental shelf delimitation between Iceland and Jan Mayen island is a leading practical example of the conciliation method at work, drawing on the same maritime concepts now codified in the chapter on the UNCLOS scheme of maritime zones.

Resort to international institutions and regional organisations

Article 52(1) of Chapter VIII of the UN Charter provides that nothing in the Charter precludes the existence of regional arrangements or agencies for dealing with such matters relating to the maintenance of international peace and security as are appropriate for regional action, provided that they are consistent with the purposes and principles of the United Nations. Article 52(2) requires members entering into such arrangements to make every effort to settle local disputes peacefully through them before referring matters to the Security Council. Article 53(1) emphasises that no enforcement action may be taken under regional arrangements without the authorisation of the Security Council. Article 24 confers on the Council the ‘primary responsibility’ for the maintenance of international peace and security; Article 103 ensures that Charter obligations prevail over conflicting treaty obligations. Various regional bodies have created machinery for the peaceful settlement of disputes — the African Union (with its Peace and Security Council established under the 2002 Protocol), the Organization of American States (the 1948 Pact of Bogotá), the Arab League, the OSCE Court of Conciliation and Arbitration of 1992, and the European Union’s Court of Justice. The detailed material on the UN system itself sits in the chapter on the subjects of international law when intergovernmental organisations are considered as legal persons. The classification of those organisations as international legal persons traces back to the framework set out in the chapter on the nature and basis of international law.

For economic disputes, a series of specialised mechanisms operates: the World Trade Organization Dispute Settlement Body and Appellate Body under Annex 2 of the Marrakesh Agreement of 1994; the International Centre for Settlement of Investment Disputes (ICSID) under the 1965 Convention; the International Court of Arbitration of the International Chamber of Commerce; the UNCITRAL Arbitration Rules of 1976 (last amended 2013); the network of bilateral investment treaties (BITs); and the Iran–United States Claims Tribunal at The Hague established under the 1981 Algiers Accords. The UN Compensation Commission, established by Security Council resolution 692 (1991), processed claims for compensation for losses arising from Iraq’s 1990 invasion of Kuwait and is an important late-twentieth-century hybrid model. The legal foundation for State liability examined in the Compensation Commission’s work overlaps with the wider doctrines reviewed in the chapter on State recognition and succession.

Arbitration — the consent-based binding method

Arbitration grew out of diplomatic settlement and represented an advance towards a developed international legal system. Modern inter-State arbitration is conventionally traced to the Jay Treaty of 1794 between Britain and the United States, which provided for mixed commissions to resolve legal disputes. The Alabama Claims arbitration of 1872 between the same two States — in which the United Kingdom was held liable to pay compensation for damage caused by a Confederate warship constructed in the United Kingdom — demonstrated the procedure’s utility and stimulated wider adoption. The 1899 Hague Convention for the Pacific Settlement of Disputes set down the now-standard definition of arbitration in Article 15: the settlement of differences between States by judges of their own choice and on the basis of respect for law. The definition was repeated in Article 37 of the 1907 Hague Conventions and adopted by the Permanent Court of International Justice and the International Court.

The 1899 Convention also established the Permanent Court of Arbitration (PCA) at The Hague. The PCA is not a court in the strict sense — it is not composed of a fixed body of judges. It is a panel of persons nominated by the contracting States (each one nominating up to four), comprising individuals of known competence in questions of international law, of the highest moral reputation and disposed to accept the duties of an arbitrator. Where contracting States wish to go to arbitration, they may choose the members of the tribunal from the panel. The PCA also consists of an International Bureau acting as registry and a Permanent Administrative Council. After a fall-off in inter-war use, the PCA has played an increasingly important role in recent decades and has acted as registry in cases including the two phases of the Eritrea–Yemen arbitration, the Eritrea–Ethiopia Boundary and Claims Commissions, the Mox Plant arbitration between the United Kingdom and Ireland, the South China Sea arbitration between the Philippines and China, and numerous investor–State arbitrations under bilateral and multilateral investment treaties.

An arbitral tribunal may be a single arbitrator or a collegiate body. In a collegiate setting, each party usually appoints an equal number of arbitrators, with the chair or umpire appointed either by the parties or by the arbitrators already nominated. States are not obliged to submit to arbitration in the absence of consent, which may be given in advance through arbitration treaties or compromissory clauses in general treaties, or after the dispute has arisen by means of a special agreement (compromis). The compromis is fundamental: it defines the jurisdiction of the tribunal and the law to be applied. The tribunal generally has the power to determine its own jurisdiction by interpreting the compromis — the principle of compétence de la compétence reaffirmed by the Tribunal in Croatia v. Slovenia (2016).

The law to be applied is international law, but the parties may agree on certain principles to be taken into account; agreements sometimes specify decisions in accordance with ‘law and equity’, in which case the general principles of justice common to legal systems are also relevant. Once made, an arbitral award is final and binding upon the parties. In rare circumstances an award may be regarded as a nullity — the recognised grounds being excès de pouvoir (excess of power), corruption of a member of the tribunal, or a serious departure from a fundamental rule of procedure including failure to state the reasons for the award. The principal example of excès de pouvoir is the North-Eastern Boundary case between Canada and the United States, where the arbitrator, after being asked to decide which of two lines constituted the frontier, in fact chose a third. Article 35 of the ILC Model Rules on Arbitral Procedure of 1958 lists the three grounds. Recent inter-State arbitrations include the Rann of Kutch (between India and Pakistan), the Anglo-French Continental Shelf, the Beagle Channel, Taba, Eritrea–Yemen, the Eritrea–Ethiopia boundary delimitation, Barbados v. Trinidad and Tobago on maritime delimitation, and Philippines v. China on the South China Sea. The chapter on the UNCLOS provisions and Indian maritime zones contains the related material on Annex VII arbitration and on the International Tribunal for the Law of the Sea.

The International Court of Justice — principal judicial organ

The International Court of Justice is the principal judicial organ of the United Nations under Article 92 of the Charter. Its Statute is annexed to the Charter. The Court sits at the Peace Palace in The Hague and is composed of fifteen judges of different nationalities, elected for nine-year terms by the General Assembly and the Security Council voting separately. Article 9 of the Statute requires the body of judges as a whole to represent the main forms of civilisation and the principal legal systems of the world. The President and Vice-President are elected by the Court itself. The Court usually sits as a full bench but may form chambers; the practice of forming five-judge ad hoc chambers under Article 26(2) for particular cases has become more common since the Gulf of Maine case.

Article 34 of the Statute provides that only States may be parties in cases before the Court. Private persons and international organisations cannot be parties to contentious proceedings, although some of the latter may obtain advisory opinions. Article 93 of the Charter provides that all UN members are ipso facto parties to the Statute and that non-members may become parties on conditions determined by the General Assembly on the recommendation of the Security Council. The Court is open to non-parties to the Statute on Security Council conditions: lodgement of a declaration with the Registrar accepting the Court’s jurisdiction and undertaking to comply in good faith with its decisions. The position of international organisations as participants in the international order is examined separately in the chapter on the territorial, personal and universal jurisdiction of States.

Article 36 jurisdiction — the consent rule and the Optional Clause

Jurisdiction in contentious cases falls into two parts under Article 36. Article 36(1) provides that the Court has jurisdiction in all cases that the parties refer to it and in all matters specially provided for in the Charter or in treaties or conventions in force. Two routes therefore operate: special agreement (compromis) referring a particular dispute, used in cases such as Minquiers and Ecrehos; and compromissory clauses in treaties giving the Court jurisdiction over disputes about the interpretation or application of the treaty. The Court founded jurisdiction on Article IX of the Genocide Convention in Bosnia v. Yugoslavia, on the Optional Protocols to the Vienna Conventions on Diplomatic and Consular Relations in US v. Iran (the Iranian Hostages case), and on Article XXIV(2) of the 1956 US–Nicaragua Treaty of Friendship in the Nicaragua case.

Article 36(2) — the Optional Clause — permits States parties to the Statute to declare that they recognise as compulsory ipso facto and without special agreement, in relation to any other State accepting the same obligation, the jurisdiction of the Court in all legal disputes concerning the interpretation of a treaty, any question of international law, the existence of any fact which if established would constitute a breach of an international obligation, or the nature or extent of the reparation to be made for the breach of an international obligation. Declarations are conditional and operate on reciprocity — the Court will only have jurisdiction to the extent that both declarations cover the dispute in question. Reservations to declarations vary widely. The most controversial form is the ‘Connally amendment’, by which a State (most prominently the United States) reserves matters within its ‘domestic jurisdiction as determined by’ itself; the validity of self-judging reservations of this kind is widely doubted. Article 36(6) confers on the Court the power to decide its own jurisdiction in the event of a dispute — the principle of compétence de la compétence at the level of the Court itself.

India’s present declaration under Article 36(2), filed on 27 September 2019, accepts the compulsory jurisdiction of the Court subject to a long list of reservations — including disputes with present or former Commonwealth members, disputes for which the parties have agreed to other means of settlement, disputes concerning the territorial integrity of India or its sovereignty over its territory, disputes concerning hostilities, armed conflicts, individual or collective acts of self-defence and resistance to aggression, and disputes essentially within domestic jurisdiction. The reservations significantly narrow the Court’s reach over India. The dualist tradition that explains the cautious posture is examined in the chapter on treaty formation and termination.

Procedure, the law applied and incidental jurisdiction

Proceedings consist of a written and an oral phase. The written phase covers memorials, counter-memorials and, where required, replies and rejoinders. The oral phase comprises the hearing of agents, counsel and advocates, witnesses and experts. Article 38 of the Statute lists the law to be applied: international conventions establishing rules expressly recognised by the contesting States; international custom as evidence of a general practice accepted as law; the general principles of law recognised by civilised nations; and, as subsidiary means for the determination of rules of law, judicial decisions and the teachings of the most highly qualified publicists of the various nations. The Court may, with the consent of the parties, decide ex aequo et bono — on the basis of justice and equity untrammelled by technical legal rules — but has not yet done so. The four formal sources are also the working anchor for the chapter on the sources of international law and Article 38 of the ICJ Statute.

Article 41 of the Statute empowers the Court to indicate, if it considers that circumstances so require, any provisional measures which ought to be taken to preserve the respective rights of either party. The Court has held in LaGrand (Germany v. United States, 2001) that orders of provisional measures are binding. Article 60 makes the judgment final and without appeal; in case of dispute about meaning or scope, the Court may construe it on the request of any party. Article 61 permits revision on the discovery of a fact of such a nature as to be a decisive factor that was unknown to the Court and to the party claiming revision when the judgment was given. Article 62 allows a State that considers it has an interest of a legal nature that may be affected by the decision to file a request for permission to intervene; Article 63 provides that whenever the construction of a convention to which States other than those concerned in the case are parties is in question, the Registrar shall notify all such States, who have the right to intervene.

Advisory jurisdiction

Article 65 of the Statute provides that the Court may give an advisory opinion on any legal question at the request of whatever body may be authorised by or in accordance with the UN Charter to make such a request. Article 96 of the Charter empowers the General Assembly and the Security Council to request advisory opinions on any legal question, and authorises other UN organs and specialised agencies, where so authorised by the General Assembly, to request opinions on legal questions arising within the scope of their activities. The Court has held that only ‘compelling reasons’ should lead it to refuse an opinion on grounds of propriety as distinct from grounds of lack of jurisdiction (Western Sahara, 1975). Major opinions include the Reparation for Injuries Opinion (1949) on the legal personality of international organisations; the Reservations to the Genocide Convention Opinion (1951); the Western Sahara Opinion (1975) on decolonisation; the Nuclear Weapons Opinion (1996) on the legality of the threat or use of nuclear weapons; and the Wall Opinion (2004) on the legal consequences of the construction of a wall in the occupied Palestinian territory. Although advisory opinions are not as such binding, they carry great authority and have shaped international law decisively. The role of advisory opinions in clarifying customary rules connects to the wider analysis in the chapter on the public-versus-private international law divide and the chapter on international humanitarian law and the Geneva Conventions, both of which draw on ICJ pronouncements as authoritative interpretation.

Indian cases before the International Court

India has been a party to a small number of cases before the Court. The most prominent are: Right of Passage over Indian Territory (Portugal v. India, 1960), where the Court recognised a Portuguese right of passage over Indian territory for private persons, civil officials and goods in general (sufficient to support the exercise of Portuguese sovereignty over the enclaves of Dadra and Nagar Aveli), but did not extend the right to armed forces, armed police and arms and ammunition; the Appeal Relating to the Jurisdiction of the ICAO Council (India v. Pakistan, 1972); the Aerial Incident of 10 August 1999 (Pakistan v. India), in which the Court held it had no jurisdiction; the Marshall Islands v. India case (2016), in which the Court held it had no jurisdiction because no dispute had been shown; and most prominently the Jadhav case (India v. Pakistan, judgment of 17 July 2019). In Jadhav, India invoked the compromissory clause of the Optional Protocol to the Vienna Convention on Consular Relations of 1963 to challenge Pakistan’s denial of consular access to Mr Kulbhushan Sudhir Jadhav, an Indian national arrested by Pakistan, tried by a military court and sentenced to death. The Court held that Pakistan had violated Article 36(1) of the Vienna Convention on Consular Relations by failing to inform Mr Jadhav of his rights under that Article without delay, by failing to inform India of his arrest without delay, and by denying India the right to communicate with him, to have access to him and to arrange for his legal representation. The Court directed Pakistan to provide effective review and reconsideration of Mr Jadhav’s conviction and sentence and held that a continued stay of execution constituted an indispensable condition for that review and reconsideration. The case demonstrated the practical reach of the Court’s jurisdiction founded on a compromissory clause and is one of the leading authorities on the consular regime considered in the chapter on diplomatic and consular privileges and immunities.

Effect of decisions and the wider system

Article 59 of the Statute provides that the decision of the Court has no binding force except between the parties and in respect of that particular case — the rule against stare decisis at the international level. Article 94 of the Charter provides that each Member of the United Nations undertakes to comply with the decision of the Court in any case to which it is a party. If any party to a case fails to perform the obligations incumbent upon it under a judgment, the other party may have recourse to the Security Council, which may, if it deems necessary, make recommendations or decide upon measures to be taken to give effect to the judgment. The system therefore relies on a combination of legal authority, reputational pressure, and the residual enforcement role of the Council. Recourse to the Court should always be considered alongside the alternative methods of customary law and general-principles based settlement and the regional and economic mechanisms outlined above. Despite the constraints of consent and enforcement, the Court has played a vital role in the evolution of international law, and its docket has grown markedly since the late 1980s.

What the exam wants you to remember

From this chapter, fix the following minimum: the text of Article 2(3) and Article 33(1) of the UN Charter and the eight peaceful means listed; the diplomatic methods (negotiation, good offices, mediation, enquiry, conciliation) and a leading example of each; the definition of arbitration in the 1899/1907 Hague Conventions; the function of the Permanent Court of Arbitration as a panel rather than a fixed bench; the consent rule and the recognised grounds of nullity (excès de pouvoir, corruption, serious departure from procedure); the structure and composition of the ICJ; the two routes to jurisdiction in Article 36(1) (special agreement and compromissory clause) and the Optional Clause in Article 36(2) with its reciprocity; the holding in LaGrand on the binding force of provisional measures; the binding force of judgments under Article 59 and the enforcement architecture of Article 94 of the Charter; and the Court’s holding in the Jadhav case on Article 36(1) of the Vienna Convention on Consular Relations. With these in place, you can address the standard objective and short-answer questions on the peaceful settlement of international disputes and have the procedural framework for the wider essay questions that link this chapter to the remaining material in these notes.

Frequently asked questions

Are States obliged to settle their disputes peacefully?

Article 2(3) of the UN Charter requires all members to settle their international disputes by peaceful means in such a manner that international peace and security and justice are not endangered. Article 33(1) requires the parties to a dispute the continuance of which is likely to endanger international peace and security to seek a solution by negotiation, enquiry, mediation, conciliation, arbitration, judicial settlement, resort to regional agencies, or other peaceful means of their choice. The 1970 Friendly Relations Declaration confirms the obligation. States are obliged to seek a peaceful settlement; they are not, however, obliged to actually reach one, and the choice of means is free.

What is the difference between mediation and conciliation?

Both are third-party diplomatic methods, but they differ in the formality and content of the third party's role. Mediation involves the active participation of a third party in the negotiating process, who tries to reconcile the differences and may put forward suggested terms but does not formally investigate the dispute. Conciliation involves a third-party investigation of the basis of the dispute and the submission of a formal report containing proposals for settlement. The conciliation procedure is set down in instruments like the 1928 General Act on Pacific Settlement and is built into multilateral treaties such as the 1969 Vienna Convention on the Law of Treaties and the 1982 Convention on the Law of the Sea. In neither case is the third-party output binding.

What is the Optional Clause under Article 36(2) of the ICJ Statute?

Article 36(2) permits any State party to the ICJ Statute to declare that it recognises as compulsory ipso facto and without special agreement, in relation to any other State accepting the same obligation, the jurisdiction of the Court over four categories of legal dispute — interpretation of a treaty, any question of international law, the existence of any fact which if established would constitute a breach of an international obligation, and the nature or extent of reparation. Declarations operate on reciprocity, so the Court will only have jurisdiction to the extent that both States' declarations cover the dispute. Declarations are usually conditional, with reservations varying widely from State to State.

What did the ICJ decide in the Jadhav case (India v. Pakistan, 2019)?

The Court held in its judgment of 17 July 2019 that Pakistan had violated Article 36(1) of the Vienna Convention on Consular Relations of 1963 by failing to inform Mr Kulbhushan Sudhir Jadhav of his rights under that provision without delay, by failing to inform India of his arrest without delay, and by denying India the right to communicate with him, to have access to him and to arrange for his legal representation. The Court directed Pakistan to provide effective review and reconsideration of Mr Jadhav's conviction and sentence and held that a continued stay of execution constituted an indispensable condition for that review and reconsideration. The Court founded its jurisdiction on the compromissory clause of the Optional Protocol to the Vienna Convention on Consular Relations.

Are provisional measures of the ICJ binding?

Yes. The position was clarified in LaGrand (Germany v. United States, 2001), where the International Court held that orders of provisional measures under Article 41 of its Statute are binding on the parties. The earlier debate had been whether the language of Article 41 — that the Court has the power to indicate provisional measures which 'ought to be taken' — was hortatory or binding. After LaGrand, the question is settled. The Court has issued binding provisional measures in subsequent cases, including the Jadhav case, where it ordered Pakistan to take all measures at its disposal to ensure that Mr Jadhav was not executed pending the Court's final decision.

How are ICJ judgments enforced?

Article 59 of the Statute makes the decision binding only between the parties and only in respect of the particular case. Article 94 of the UN Charter provides that each member undertakes to comply with the decision of the Court in any case to which it is a party. If a party fails to perform its obligations under a judgment, the other party may have recourse to the Security Council, which may make recommendations or decide upon measures to be taken to give effect to the judgment. There is, however, no automatic enforcement: the Council's response is political and any permanent member may veto a draft resolution. In practice, compliance has been the norm, supported by the legal authority of the Court and the reputational cost of defiance.