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Garibaldi, Oscar M., Abuse of rights in investment disputes : a critical analysis, in: Arbitraje: revista de arbitraje comercial y de inversiones. eISSN. 2603-9281. vol. 13, n. 2, 2021, pp 33-118

Title
Garibaldi, Oscar M., Abuse of rights in investment disputes : a critical analysis, in: Arbitraje: revista de arbitraje comercial y de inversiones. eISSN. 2603-9281. vol. 13, n. 2, 2021, pp 33-118
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D. The Principle of Good Faith


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The principle of good faith is well established as a norm of general international law, so much so that the International Court of Justice has placed it at

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the basis of the modern international legal order. In the Nuclear Tests Case, the Court recognized it as «[o]ne of the basic principles governing the creation and performance of legal obligations, whatever their source» and the foundation of the principle pacta sunt servanda66. The Vienna Convention on the Law of Treaties requires that treaties be interpreted and performed in good faith67. But the principle of good faith referred to in the Nuclear Tests Case and in the Vienna Convention concerns legal obligations, be they primary obligations of the subjects of international law or secondary obligations relating to the inter-pretation and application of treaties.

To say that the principle of good faith governs the performance of international obligations and the interpretation of treaties does not logically entail that it (also) governs the exercise of international rights68. Nor can the gap be filled by mere analogy. An obligation under international law, including an obligation concerning the interpretation of treaties, concerns conduct that is defined (with some specificity) and qualified as obligatory. Applying the principle of good faith to the performance of those obligations does expand the universe of obligatory conduct, but only in an ancillary manner, in relation to the content of those obligations. In contrast, the exercise of rights under international law includes a large universe of unspecified conduct which is qualified as permitted because international law does not prohibit it. If that universe of permitted conduct were subject to a generic obligation to act in good faith, the rule of closure of the international order (everything not prohibited is permitted), the resulting autonomy of states, and the structure of the international order based on such autonomy would be radically altered. Such a result would not be logically impossible, but it cannot simply be assumed, nor can it be inferred from the obligation to perform international obligations in good faith.

66Nuclear Tests (New Zealand v. France), 1974 I.C.J. 457, p. 473 (20 December 1974); see also Border and Transborder Armed Actions (Nicaragua v. Honduras), 1988 I.C.J. 69, 105 (20 December 1988). How the principle of good faith has become a component of the international legal order is a question that exceeds the scope of this article.
67Article 26 and 31(1) of the Vienna Convention on the Law of Treaties.
68Paulsson reaches the same conclusion on a powerful line of argument which generally runs parallel and occasionally coincides with my own. See Paulsson, op. cit., pp. 20-24 and especially 33-35 [Paulsson, Jan, The Unruly Notion of Abuse of Rights (Cambridge University Press, 2020)].

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