Good Faith in WTO Dispute Settlement

Abstract

The definition of good faith in international law has been largely elusive, and its indefinite boundaries complicate its use in the World Trade Organization. Nevertheless, good faith is almost certainly a general principle of law and a principle of customary international law. It is also a principle of WTO law that is reflected in several provisions of the Understanding on Rules and Procedures Governing the Settlement of Disputes. WTO Tribunals may use the principle of good faith not merely to interpret WTO provisions, but also in the exercise of their inherent jurisdiction, such as when employing the doctrine of estoppel, which is one particularisation of good faith. However, the use of good faith in WTO dispute settlement entails three important considerations and qualifications. First, the principle should not be used to overwhelm WTO provisions that appear to be based on concepts similar to those underlying the principle of good faith, such as non-violation complaints, which are subject to detailed rules. Second, the principle should not be confused with other principles that may appear to be related, particularly due process. Third, in my view, WTO Tribunals have no legal basis for finding that a Member has violated a principle of good faith independent of a violation of a WTO provision. Some existing reports err in this regard.