Custom and Its Interpretation in International Investment Law

Abstract

At first glance, one may think of international investment law (IIL) as a response to custom (or lack thereof), instead of a field of its application. Indeed, modern IIL and arbitration arguably have developed in order to fill the void provoked by the challenges to the Hull formula and other custom regarding the treatment of aliens, especially post-1945 and, most notably, through the New International Economic Order (NIEO). Hence, one may be inclined to wonder whether an inquiry into the relationship of custom and IIL, as this edited volume intends, represents a rather skewed or anachronistic choice of topic.However, in fact, the opposite is the case. Looking at the practice of international investment tribunals as well as the central discussions in international legal scholarship, general international law and most of all customary international law (CIL) is pervasive, if not to say ubiquitous. The interpretation and application of customary rules and principles is the bread and butter of IIL and arbitration. Interpretation, termination or provisional application of treaties, attribution of conduct, circumstances precluding wrongfulness or reparation and other remedies are but a few examples of how CIL permeates the IIL and arbitration. Custom is of pivotal importance in nearly every single investment dispute. Even beyond 14