Good Faith in WTO Dispute Settlement

25/08/2008 12:00 - 1509 total view

Andrew D. Mitchell

 

The principle of good faith has a great deal of normative appeal, and most commentators would acknowledge that it plays a role in all legal systems. The ordinary meaning of good faith is ‘honesty of purpose or sincerity of declaration’ or the ‘expectation of such qualities in others’. ‘Good faith’ is often used interchangeably with ‘bona fides’, which is defined as ‘freedom from intent to deceive’. The touchstone of good faith is therefore honesty, a subjective state of mind, but the principle can also incorporate notions of fairness and reasonableness, both of which concern an objective state of affairs. Unfortunately, terms like honesty, fairness and reasonableness are almost as vague as good faith. This leads Rosenne to ask of good faith: ‘Is it a principle and a rule of law, having an identifiable and where necessary enforceable legal content, or is it nothing more than a throw-back to outmoded natural law concepts?’ If good faith has no independent legal content, it may be of little use to World Trade Organization Tribunals in resolving disputes: ‘one may acknowledge the power and attraction of a general idea but the idea may be so general that it is of no practical utility to the merchant’. In this article, I attempt to clarify the meaning of good faith to the extent relevant to the WTO, by examining good faith as a general principle of law, a principle of customary international law, and a principle of WTO law. Below, I start by considering the existence and meaning of the principle of good faith in international law outside the WTO. Although I do not aim to establish definitively whether good faith is a general principle of law or a principle of customary international law, it is undoubtedly a well-accepted fundamental norm in many domestic and international contexts. It takes several more specific forms in relation to the interpretation and performance of treaties, as well as in the doctrines of abuse of rights and estoppel. Having considered good faith outside the WTO, I turn to the use of this principle in WTO disputes. I first determine the scope of good faith as a principle of WTO law, before assessing the procedural and substantive implications of good faith for WTO dispute settlement. I pay particular attention to the ways in which WTO Tribunals have used the principle of good faith so far.