Academic journal article Proceedings of the Annual Meeting-American Society of International Law

Canute Confronts the Tide: States vs. Tribunals and the Evolution of the Minimum Standard in Customary International Law

Academic journal article Proceedings of the Annual Meeting-American Society of International Law

Canute Confronts the Tide: States vs. Tribunals and the Evolution of the Minimum Standard in Customary International Law

Article excerpt

The Charles N. Brower Lecture on International Dispute Resolution was given at 4:30 p.m., Thursday, April 9. The speaker was Professor W. Michael Reisman of Yale Law School.


By W. Michael Reisman *

One discontent with international investment law seems to be shared by both capital-importing and capital-exporting states: that investment tribunals exceed their proper limits in applying the so-called Fair and Equitable Treatment Standard, or FET. I submit:

first, that FET's vitality is a function of the type of rule it is;

second, that the diminished capacity of states to control FET's arbitral evolution is a consequence of the democratization of the contemporary customary international law process; and

third, that state efforts to confine the exercise of arbitrators' judgment in each application of FET, especially by trying to anchor it to the international minimum standard (the MST), are as futile as King Canute's attempt to control the tides.

But to make my case, allow me to begin with two excurses. The first is from the realm of legal theory and has to do with the types of rule formulations to which lawmakers resort, and the second is a comment on the nature of contemporary customary international law as it affects rules such as FET and the MST.


First, the rules: when lawmakers set out to enact policy into law, they have at their disposal two species of "rules." One species of rules transfers to the ultimate rule- applier the most limited exercise of discretion. Scholars, from John Austin on, have coined various terms for rules of this type. I propose to call them "verification rules," because their most salient characteristic is that they authorize those charged with applying them to do nothing more than verify compliance with an explicit metric. A mundane example might be that the swinging door to a washroom in a workplace must be no more than five inches from the floor. A momentous example is that an ICBM is to be fired by the officer in the silo only upon receiving a coded signal from the president of the United States.

Verification rules are binary, "either-or rules." Beyond that binary information, the factual and normative universe to which the person charged with applying the rules may turn is strictly confined to a few explicit variables, none of which includes general evaluative concepts such as fairness, equity, justice, minimum order, efficiency, or even common sense.

What we may call "evaluation rules," by contrast, do not contain a binary metric. Instead, they establish a goal that is expressed at some level of generality. For example, Article 39 of the United Nations Charter is an evaluation rule:

   The Security Council shall determine the existence of any threat to
   the peace, breach of the peace, or act of aggression and shall make
   recommendations, or decide what measures shall be taken in
   accordance with Articles 41 and 42, to maintain or restore
   international peace and security.

Realizing the goal of Article 39 requires its appliers (in this instance permanent representatives in the Security Council) to take account of a range of variables and to exercise judgment as to their contribution, in varying, idiosyncratic contexts, to realizing the goal that has been specified. Both evaluation and verification rules involve judgment, but that judgment is very different in terms of scope and methodology--evaluation rules import contextual as well as textual methodologies.

The legislator's use of verification rules generally increases as one descends the application ladder; resort to evaluation rules generally increases as one ascends the hierarchy. By that, I do not mean to suggest that verification rules are reserved for trivial or second-order policy issues. …

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