In this chapter, the authors frame the interwar period as instrumental for the institutionalisation of international dispute settlement, with respect to both the establishment of institutions and the development of new applicable law. The chapter focuses on the institutions, but equally emphasises the foundational principles which govern the field, with the principle of consent at the forefront; with all their characteristic features and limitations, such principles are conspicuous and remain valid today. The chapter gives context to the creation of the Permanent Court of Arbitration (PCA) and the subsequent establishment and the main features of the Permanent Court; last but not least, it pays homage to the mixed arbitral tribunals, with their impressive machinery and cases decided. The interwar period was undoubtedly a time of experimentation, but it would be naïve to believe that it has come to an end: experiments remain ongoing.

The chapter gives an overview of dispute settlement during the Old Regime. Contrary to older assessments of the historiography, dispute settlement retained its importance in this era, both in qualitative and in quantitative terms. This was true for the field of theoretical literatures, which, from the last decades of the seventeenth century, dealt intensively with the subject. Normally, a clear distinction was made between an elected arbiter, who definitively decided a dispute, and a mediator, who only made peace proposals. Diplomatic practice, which made intensive use of the instruments of dispute settlement until the last decades of the eighteenth century, was much more flexible. The transitions between arbitration and mediation were fluid; the boundaries of confession and rank were also frequently crossed. In Old Regime Europe, mediation was also used for the first time in peace negotiations between Christian and Islamic powers. New forms of mediation emerged as well. One was the armed mediation, in which a power intervened in a conflict uninvited and set a peace ultimatum; this could easily lead to war. This indicates that dispute settlement did not automatically contribute to an increase in peace; the relationship of dispute settlement to war and peace remained rather ambivalent in Old Regime Europe.

Over the years, the economic relationship between China and African states has continued to grow and this is evident in the volume of Chinese investments in Africa. In the wake of these investments, China and African states have signed bilateral investment treaties (BITs), which aim to promote the development of host states and protect foreign investments from one contracting state in the territory of the other contracting state, thereby stimulating foreign investments by reducing political risk. BITs are unique in character in that they provide substantive protections to foreign investors and a basis for claims by an individual or company against a host state on grounds that such substantive protections have been breached by the host state. To avoid the need to turn to the national courts in the host state for a judicial remedy, BITs usually contain an arbitration clause submitting disputes to a neutral arbitration tribunal. This case study demonstrates one such instance where, in a first-of-its-kind case, a Chinese investor sued Nigeria, an African host state, for breach of its treaty obligations under the China-Nigeria BIT 2001, and throws light on how BITs can be used in the protection of Chinese outbound investments, including in Africa.

This chapter delves into the question of the impact of extraterritorial and secondary sanctions on private contractual relations. It opens with a discussion of the characterisation of extraterritorial and secondary sanctions as potential legal or factual impediments to the performance of contractual obligations. A detailed analysis of the case law follows, bringing to the fore some degree of reluctance on the part of judicial authorities to allow operators to suspend the performance of their contractual obligations or to terminate contractual relations on account of their exposure to extraterritorial or secondary sanctions, at least in the absence of sanctions or force majeure contractual clauses. The chapter also explores the potential tension between such sanctions, on the one hand, and measures – commonly referred to as blocking statutes – enacted by states or by the EU to thwart their effects, on the other hand. A discussion, in this respect, of the relevant case law reveals a quest for a balance between policy objectives and economic soundness and shows the existence of incongruent views on the compatibility of sanctions clauses with blocking statutes.

To litigate or not to litigate, that is the question any Chinese companies operating in the United States long enough must contemplate. For American companies, litigation is nothing but an unavoidable business risk and often a vital competition strategy, routinely dealt with by legal and managerial professionals applying monetarized cost–benefit analysis. Such analysis typically incorporates attorney fees and other litigation expenses, potential reputational damage, time and human resource consumption, and the present value of expected litigation gains or losses. By contrast, litigation in China carries complex social meanings and is often avoided to preserve long-term cooperative relationships or to signal desirable attributes to uninformed third parties. When lawsuits do occur, they are often handled by stakeholders without professional legal assistance. Disputants consider a wide range of material and nonmaterial interests that are shaped by both formal institutions undergoing significant transformation and complex, entrenched social norms governing dispute resolution. Chinese companies immersed in these two disparate institutional environments approach legal disputes in the United States.

Chapter 4 surveys a wide range of friendly and hostile interstate relations in ancient societies, where war was often the normal state of affairs. Notwithstanding the numerous conflicts, polities tried in the end, through alliances and diplomatic relations, to establish peaceful relations in view of political stability and economic prosperity. The chapter analyses hospitality rules regarding foreigners, treaties between polities and the establishment of diplomatic relations, which emerged as an international system in the ancient Near East during the mid-fourteenth century bce. An alternative to diplomacy in conflict management, typical of the Greek world, was arbitration and mediation with the help of a third party. In a final section, the chapter outlines how states, when diplomacy failed, started a war procedurally. In conclusion, the chapter argues that, in the absence of an international court, the enforcement of diplomatic rules and treaties was in many ancient societies ensured by the supranational authority of the gods.

Although civil trials provide for the lawful resolution of many kinds of disputes, the vast majority of civil matters are resolved through other processes: Negotiation, mediation, and arbitration. This chapter provides an overview of the main psychological and structural factors that influence disputants’ decisions to select and use these primary alternative dispute resolution (ADR) processes. Further, the chapter discusses the psychology of decision-making in the context of alternative dispute resolution, including identifying what constitutes successful outcomes and how biases and other tendencies can prevent parties from realizing these outcomes. Finally, the chapter addresses research on the ways in which non-parties such as mediators, facilitators, arbitrators, and judges can improve (or diminish) the likelihood that parties’ voices will be heard, that parties will be satisfied with the process, and that the selected process will result in substantively satisfactory outcomes. Major research gaps and policy implications are identified and discussed.

To what extent does soft law ensure harmonisation? Does it replace the governing law or does it complement it?

Does arbitration permit a self-sufficient contract? To what extent can relevance be disregarded without affecting the validity and enforceability of an award? What power does the arbitral tribunal have?

Contract practice andthe reasons for its standardised style. A discussion ofboilerplate clauses. A presentation of the theories of the relational contract and of the autonomous contract.

How is the governing law of a contract determined? What are the effects of the parties' choice of law? How is the governing law chosen in arbitration?

How did polities interact in the Archaic and Classical periods, and which norms influenced their behaviour? This chapter aims to answer these questions. By moving away from the dominant Realist interpretation of ancient history, and employing a variety of themes that played a role in neighbourly relations, a fresh and different understanding of neighbourly diplomatic interactions emerges. Four norms are investigated; first, the decision to go to war or avoid that possibility; second, friendship ties; third, reciprocity; and fourth, reputation. By analysing the reasoning behind the breakdown of neighbourly relations, it will become that clear political actors frequently sought ways to restore the status quo and peaceful co-existence. A second factor is the friendship ties between leaders and how this influenced the direction of the neighbours vis-à-vis one another. The third aspect is reciprocity, and how this formed a staple of neighbourly relations and could be called upon to reinforce neighbourly ties. Finally, the notions of reputation and trust are investigated to show that the reputation of a polis influenced neighbourly relations, whether positively or negatively. Earlier behaviour, such as abandoning an alliance, impacted decision-making and required significant efforts to restore the trust between the neighbours.

In this chapter, Sir Michael Wood examines the future of the international dispute settlement system. The core claim of this chapter is that continuity is, and will continue to be, this system’s defining feature. It observes that the fundamentals of inter-State disputes have changed little since 1920. Most notably, consent to third-party dispute settlement remains at the heart of the system, as does a widespread reluctance by sovereign States to give that consent in advance of disputes arising. The Optional Clause, for example, remains unchanged after 100 years, as does States’ unwillingness to accept it or to do so without extensive reservations. That said, and reflecting on the chapters contained in this collection, this chapter accepts that there have been new and important developments in the international dispute settlement system in recent years and, providing their promise is realised, they will perform a critical function in maintaining international peace and security.

In this chapter, Eric De Brabandere zeroes in on the settlement of disputes in the context of investment arbitration. This chapter accepts that the case law of the current investor-State dispute settlement system is inconsistent and unpredictable and requires reform. However, this chapter claims that the problems associated with the dispute settlement system for investment arbitration cannot be isolated from broader questions on the coherence of general international law, the determinacy of legal norms, and the role of arbitral tribunals in the interpretation of these norms. The chapter argues that coherence is a matter of degrees and that a ‘middle ground’ might be to consider that international investment law forms part of international law, which is a coherent legal system from the perspective of the sources or the secondary norms of international law. Consistency, on the other hand, is not completely achievable in the current investment landscape, given its lack of uniformity in terms of substantive law and ad hoc method of dispute settlement. Consistency must be sought through different options, such as redrafting investment treaties to ensure better balance and predictability of outcomes.