Originally from American Review of International Arbitration - ARIA

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NEW APPROACHES TO THE STATE OF NECESSITY IN
CUSTOMARY INTERNATIONAL LAW: INSIGHTS FROM WTO LAW
AND FOREIGN INVESTMENT LAW
Alberto Alvarez-Jiménez*
 

 Both the International Court of Justice ("ICJ") in the Case Concerning The
Gabcikovo-Nagymaros Project (Hungary/Slovakia),1 and the International Law
Commission ("ILC") in its commentaries to its Articles on State Responsibility
have pointed out that the requirements for the successful invocation of the defense
of necessity embodied in Article 25 of the ILC’s Articles on State Responsibility
("ILC’s Articles") need to be interpreted narrowly in order to prevent the abuse of
this provision and the ensuing effect of justifying wrongful international acts. The
result is that Article 25 is a provision the availability of which to States seems
very limited, even in extreme circumstances.

There are, however, other approaches to necessity that are being developed in
international law that differ from the traditional one of customary international
law. On the one hand, WTO law, although for a different type of "necessity," has
developed an approach that is more lenient and that makes GATT necessity
exceptions available to WTO Members to justify unlawful measures pursuing
values other than trade, without generating the abuse of such exceptions. On the
other hand, foreign investment law has fashioned another approach regarding
Article 25 that responds to the particularities of investor/State disputes. It is strict,
like that of the ICJ in the sense that the defense of necessity is not available to
States even when they face crises of significance, but does not leave States to bear
all the risk of such proven crises. In addition to illustrating the new approaches to
necessity in international law, this article shows how the WTO model can also be
deployed in the interpretation and application of Article 25, without creating the
conditions for its abuse.

The article is divided into five parts. The first part analyzes Article 25 on the
basis of its interpretation by the ICJ and the ILC. The second part illustrates the
approach adopted by the WTO Appellate Body ("AB") regarding the necessity
exceptions in the WTO. The third part presents the results of the disputes
stemming from Argentina’s crisis of 2000 and the main approach to Article 25
that investor/State tribunals have created to resolve such conflicts. The fourth part
shows how the WTO model can be transplanted to the interpretation of Article 25
and be applied by courts and investor/State tribunals. Finally, the fifth part
provides the conclusions of the article.