Abstract
International Trade is a hot topic being discussed by the public because of the economic linkages in the progress of recent rapid development. In the international trade contract, there is not only goods trade activity but also service trade including contracts related to investment, finance, construction, transportation activity, and even contracts made in electronic. This research aims to find out and analyze regarding legal consequences of applying the principle of good faith which is only existed when the contract is executed in International Investment Contract in Indonesia. In addition, the other purpose is to find out and analyze the alternative solutions if a dispute is occurred. This research is doctrinal research using secondary data. The secondary data used is primary legal material, secondary legal material, and tertiary legal material. Moreover, technique of collecting data is carried on by library research. Meanwhile, technique of analysis data used in this research is qualitative data analysis using historical approach. The good faith principal which is only applied at the time of the contract will bring the dispute in the future. Therefore, if this principle is applied in the negotiation stage in each contract, the risk of the dispute in each contract will be smaller. Basically, good faith principal existed in humans as social beings who always need cooperation, though every country has different legal system in regulating the good faith principal. Hence, if there is conflict and dispute in the International Investment Contract, according to the law of Indonesia in the Act No. 25 Of 2007 concerning investment, it will be undertaken by international arbitration. However, it is possible to use other arbitration institution agreed by both sides. If there is dispute and the parties do not determine the legal choice and do not include it in the agreement, the institutions above can be used according to the agreement between the two parties. Meanwhile, for foreign investors who sign investment contracts in Indonesia, if there is dispute in the investment contract, it will be settled through International arbitration.
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